• Budget

    Mid Devon Advertiser
    17 March 2017

    Last week the House was packed to hear the Chancellor. The record for the longest budget speech belongs to Gladstone who in 1853 addressed the Commons for 4 hours 45 minutes sustained by eggs and sherry. The shortest speech belongs to Disraeli. Philip Hammond delivered his between modest sips of water, in 56 minutes. It was set against a background of Brexit and the deficit. Both require caution. With a national debt of £1.7 trillion and the interest on this running at £50 billion a year (more than we spend on defence and policing combined), there is a strong need to keep spending under control. Brexit brings considerable future uncertainty and it calls for prudence too – better to hold back possible spending so that it is available for if the UK economy stalls as a result of EU negotiations. Much is going well with the economy at the moment - albeit we are still 2 years away from our EU exit. Economic growth forecasts have been ratcheted up and in 2016 UK Plc grew faster than all the other major economies (with the exception of Germany) including the USA and Japan. There are now more people in work than at any time in our history including more women in the workforce than ever before. Unemployment is at an 11 year low. Inflation is on the increase due in part to the devaluation of the pound and increased commodity prices (oil etc.) but forecasts still show real wages expected to rise throughout the rest of this parliament. The independent OBR forecasts average earnings growth of 2.4% in 2017 and 2.8% in 2018, followed by annual growth above 3% through to 2021. This will help to sustain consumer expenditure (which represents around 80% of the economy). And government borrowing figures are better than projected at the time of the Chancellor’s autumn statement. All good, but the future is likely to be a bumpy place and now is a time for prudence not turning on the spending taps. Despite this the Chancellor has managed to announce that there will be a further £2 billion for adult social care over the next 3 years. This is a key priority and will help councils provide better social care and take some pressure off the NHS. £100 million has also been set aside for A&E departments to help manage demand ahead of next winter. This money will assist by providing more on-site GP facilities and more space in A&Es for the assessment of patients when they arrive. The budget also included a £300 million "discretionary relief" fund for councils to support local firms and there is to be a £1,000 deduction to the coming business rates bill for most pubs. In addition, Tax-Free Childcare will provide up to £2,000 a year in childcare support for each child under 12 and parents will be able to receive up to £4,000 for disabled children up to the age of 17. More from Mel at